Key Highlights 2011

Where everything
takes off
Key Highlights 2011
1
Message from the CEO
Did you know that at Budapest Airport you can get
The SkyCourt is the centerpiece of the EUR 261 mil-
from the parking lot to your gate – including check-
lion BUD Future modernization and expansion pro-
in and passenger screening – in just seven minutes?
gram, intended to help Budapest Airport become the
leading airport in Central and Eastern Europe – but
What makes this possible is the SkyCourt – our new
it is not the only part of the development. From April
terminal hall between building wings 2A and 2B. A
2011 on, for instance, Terminals 2A und 2B were given
small step for passengers, a big stride forward for our
a thorough refurbishment that was finished by the
airport. But no matter how quickly you can now get
end of May 2012.
to your flight, we hope that you will spend a while getting to know the SkyCourt.
But that is not all. During last year, our Aviation team
has made every eff ort to attract new airlines and to
The opening of the SkyCourt was definitely the most
open up new destinations. Our route development
important event for Budapest Airport in 2011. Even
incentives, in-depth market analysis, passenger re-
before it was inaugurated, this striking glazed com-
search, joint campaigns with stakeholders and the
plex had won an award and now it delights our cus-
social media enabled us to earn two of the most cov-
tomers both functionally and esthetically. And in our
eted industry distinctions: in the European and the
day-to-day work, we share the enthusiasm of our
World Routes Airport Marketing Awards, the airline
passengers. It is a great place to spend time before
community named us the best European airport.
taking off, to do some shopping, have a snack or a
meal and enjoy a glass of great Hungarian wine. It
Looking ahead, taking new paths – in the past few
also accommodates the brand-new baggage han-
years we have demonstrated great courage and a
dling installation and the central security system, with
wealth of ideas. In 2011 we reaped the fruits of this
the latter streamlining passenger screening.
with a record performance: 8.9 million passengers
flew from and to Budapest Airport. In 2012 we want
We have invested EUR 102 million into this terminal
to demonstrate how prudently pursued development
building – despite the uneasy economic times. It is
can keep an airport on course even under unfavorable
an investment which will benefit both neighboring
conditions.
communities and also the country’s services sector
and industry. As a dependable business dynamo and
With our new image and self-awareness, we promise
a visiting card which reflects Hungary’s capabilities
our customers quality, comfort and convenience. We
as a nation, our airport fulfills a basic prerequisite for
cordially invite you to experience for yourself just how
attracting foreign companies here.
we are keeping our promises.
Today it is evident that this new terminal building was
opened at just the right time. Following the insolvency of the state airline Malév – our most important customer – in February 2012, the SkyCourt has played a
key role in keeping our company moving forward. Air-
Jost Lammers,
lines in both the full-service and the low-cost seg-
CEO Budapest Airport
ments appreciate Budapest Airport’s modern infrastructure and high-quality service. So aircraft seats
that had been on offer by Malév were quickly taken up.
2
3
the airport is aiming to create additional business
opportunities in the field of non-aviation from the
now wider and more attractive spectrum of retail outlets.
Altogether, the SkyCourt doubles the commercial
space at the airport.
The largest premises in the SkyCourt – with an area
of 1,400 square meters – have been let to the firm
of Gebr. Heinemann, which in Germany is the No. 1
operator of duty-free stores at airports. The SkyCourt applies the walk-through principle. On their
way from the security controls, passengers are
streamed through the duty-free area. But the needs
of travelers who are in a hurry have also been taken
into consideration and they can find their way around
easily. Lowered and marked ceilings point the way
directly to the central information area and on to the
gates.
Despite the ample shopping facilities, only 4,400
Budapest Airport 2011: The
year when everything took off
out of a total of 24,000 square meters are used for
non-aviation business. A large part of the SkyCourt
is reserved for key aviation functions such as
check-in, passenger screening and baggage handling.
On 18 March 2011, Budapest Airport inaugurated its
million program BUD Future, intended to help
new terminal building SkyCourt in the presence of
Budapest Airport become the most successful air-
The opening ceremony also saw the launching of
800 guests and all employees. 28 March 2011 then
port in Central and Eastern Europe.
the airport’s new umbrella brand “bud”. And the
SkyCourt gives expression to what the logo and
marked the official commencement of passenger
For the airport, the SkyCourt represents a precon-
the airport company’s revised positioning stand
dition for further growth. By linking the present Ter-
for: the pleasure of anticipation and high-quality
Completed on time and within budget, this glass
minals 2A and 2B, it enables these to be used more
service. With this new 5-star facility, Budapest Air-
structure, representing an investment volume of
flexibly and thus to ease peak loads, for example in
port proves that it is turning its performance claims
EUR 102 million, is the centerpiece of the EUR 261
passenger screening procedures. At the same time,
into reality .
operations, which got off to a smooth start.
January
February
March
April
May
July
September
October
November
With Qatar Air ways,
SkyCourt awarded the
Budapest Airport cele-
American Airlines
Budapest Airport is over-
Turkish Cargo chooses
Hungarian Postal Ex-
Budapest Airport is
SkyWork
Airlines
All-time record for
Budapest Airport wel-
Hungarian-British Tier-
brates SkyCourt open-
launches new Budapest
all winner of Routes Air-
Budapest as new freighter
change Center starts
Europe’s best at World
launches new service
the year of 8,920,653
comes the first Middle
ney Clark Award for ex-
ing.
to New York flight.
port Marketing Awards,
destination.
operation at airport.
Routes Conference.
from Bern to Budapest.
passengers at Buda-
Eastern scheduled car-
cellence in civil engi-
New
rier, with destination
neering.
“bud” launched.
Qatar
Doha.
umbrella
capital
brand
Budapest
Airport carbon
Europe.
Lufthansa’s A380 visits
The busiest May ever:
Budapest Airport for first
776,704 passen-
December
pest Airport.
time ever.
gers handled.
accredited by ACI
Europe.
4
Highlights
5
Report 2011
Business Segment Aviation
factors have contributed to this strong growth. This
Business Segment Consumers
segment recorded a 19.6 % rise in passenger numbers
Budapest Airport registered an 8.9 % traffic increase
versus 2010. There was a significant upturn of 44.7 %
The opening of SkyCourt substantially increased
and recorded an all-time high of 8,920,653 passen-
in the field of long-haul flights; this can be attributed
the airport’s passenger capacity and improved com-
gers. The result surpassed the European average of
to Qatar Airways and American Airlines, while Delta
fort and convenience by broadening food and beverage
7 % according to international statistics.
and Hainan remained strong market players. Malév
services and shopping facilities. Quarterly passenger
Hungarian Airlines improved its performance rapid-
satisfaction surveys reflect this development, show-
ly in the fourth quarter of 2011 and carried 200,000
ing a giant leap in how travelers assess the level of
more passengers than in 2010; the number of trans-
service which Budapest Airport provides.
Passengers
2011
2010
2009
2008
8,920,653
8,190,089
8,095,367
8,443,053
fer passengers was over 8 % higher and accounted
Aircraft Movements
for 17 % of the overall total. The low-cost carrier seg-
The SkyCourt retail concept consists of:
ment also continued to grow, fuelled for instance by
• State-of-the-art retail design on 4,400 square
the fact that Wizzair has now based its fourth aircraft
2011
2010
2009
2008
109,949
105,507
109,811
117,876
at the airport.
meters of commercial space
• New high-end Hungarian and global retail brands
• Broad food service
Budapest Airport made every effort to attract new
airlines and to open new destinations in the past
On the mezzanine level, passengers can choose
Full-service airlines such as Lufthansa, British Airways,
year. Qatar Airways launched its Doha-Budapest
between a wide selection of restaurants, bars, and
KLM, Air France, Swiss, Turkish Airlines and many oth-
flight in January 2011, and the service went daily in
cafés. At the same time, thanks to the spectacular
Advertising developments in 2011 focused around new
ers have been the main drivers of the traffic increase.
September due to ever-increasing demand. American
glass façade, they can enjoy watching airside opera-
digital tools, including the biggest outdoor LED wall in
Rises in flight frequencies, aircraft size and seat load
Airlines was a newcomer to the Hungarian market
tions.
Hungary, and two new large digital screens in SkyCourt.
by starting daily New York (JFK)-Budapest service.
The landside business launched the first airport park-
The Baltic region became available for travelers from
Besides SkyCourt, the retail offer available in the
ing advertising campaign in recent years; this proved to
Hungary in May, when Air Baltic started four week-
landside areas of Terminal 2 has also been upgrad-
be highly successful with travelers. At the same time a
Air traffic performance
ly flights from Riga to the Hungarian capital. Anoth-
ed – several new food and beverage and retail out-
number of smaller improvements were delivered, mak-
Airlines: 34 scheduled airlines operated in 2011 (+6.3 %).
er new route was opened by Jet2.com, connecting
lets have been opened or refurbished by May 2012.
ing ground transportation and parking services more
the heart of Scotland with Budapest in June with the
5 Low-cost
launch of its popular Edinburgh flight. The Swiss
5
29 Full-service
SkyWork Airlines started flights between Bern and
Budapest at the end of the year, thus increasing the
Budapest Airport to four (after Zurich, Basel and
Property management
Geneva).
Rental income from the letting of land and building
space was maintained despite the difficult market con-
Destinations: 94
94
92
Business Segment Property
number of Swiss cities on the destination map of
29
94 airports (+2.2 %)
convenient for passengers.
84 cities (+5 %)
84
80
42 countries (+5 %)
42
40
The detailed route development incentives, in-
ditions in the real estate sector and actually increased
depth market analysis, passenger research, the in-
by 5 % over the previous year to EUR 25 million. In 2011,
volvement of stakeholders and social media in joint
the focus was clearly on the completion and handover
companies resulted in 13 new air services in the last
of the SkyCourt and developing and delivery of the
twelve months. These airline development activities
rental units to the respective tenants. All fit-out works
were highly regarded by the airline community
were completed on time.
which named us the best European airport at the
2011
2010
2011
2010
15 scheduled and 35 charter cargo destinations
2011
2010
Routes Airport Marketing Awards of Europe and
The opening of SkyCourt brought the development
worldwide.
of new airline lounge facilities for StarAlliance and
OneWorld.
6
7
had planned to move its entire administration –
currently spread across various locations – back to
BUD Future
the airport. But when the airline filed for bankruptcy
in February 2012, the substantial renovation pro-
• Major refurbishment of the existing Terminals 2A
gram, involving 10,000 square meters of off ice
and 2B, replacement of building systems on
space, had to be stopped. Only one building of the
36,000 square meter gross floor area, new floor
three planned has been completed. The refurbish-
layouts on 10,000 square meter gross floor area,
ment was prepared and carried out in accordance
all works executed under full terminal operations
with the international BREEAM energy-saving
• Refurbishment of all building interfaces such as
standards.
passenger boarding bridges, staircases and curbside at Terminals 2A and 2B
2011 brought the start of operations for the new
• Reconfiguration of the perimeter fence and instal-
Hungarian Postal Exchange Center, situated near
lation of new intrusion alarm systems
Terminal 2. The facility had actually been ready by
• Permit design and public procurement of construc-
October 2010, but it was then placed at the disposal
tion works for BUD Cargo City Phase 1
of the Hungarian government for six months in
• Installation of purification systems for the storm
connection with Hungary’s Presidency of the EU at
water drainage
the beginning of 2011. Having completed a series of
• Installation of a new main electrical feed
successful test-runs, the center now forwards airmail
• Start of the refurbishment of existing office build-
to and from Hungary.
Budapest Airport is geared to develop into a lead-
ings with about 10,000 square meter gross floor
ing airport in Central and Eastern Europe in the
area.
coming decade. To strengthen its competitiveness,
• Road refurbishments
everything at the airport centers on BUD Future,
the expansion and upgrading program worth EUR
261 million. Within this agenda the infrastructure is
In addition, Business Segment Property was able
being thoroughly modernized and new f ields of
to deliver a lounge facility to Master Card for an ex-
business are being opened up.
clusive concept of its own, making the lounge available to credit card holders. The continuous growth
The new terminal structure SkyCourt is the most
in the number of guests there demonstrates the
prominent feature of BUD Future, representing an
success of this idea, which is unique in Europe.
investment volume of EUR 102 million. The transfer
building was opened in March 2011 and links the ex-
Property development
isting Terminals 2A and 2B (see page 4). It offers
In 2011, the second phase of the 70,000 square me-
passengers and visitors a high-quality stay, with
ter Cargo City, which is being created at a cost of
stunning views of both the runway system and the
EUR 20 million, was prepared. By then, 90 % of the
surrounding landscape. At the same time, it accom-
new freight center was already prelet. Following the
modates centralized baggage handling and secu-
Malév grounding, further project development has
rity systems, which will streamline passenger
been postponed to 2014.
screening and check-in processes.
Already signed and under implementation was the
Cargo business
In 2011, the airport company was also involved in
new corporate headquarters for Malév. The carrier
Budapest Airport is playing an increasingly impor-
other projects. The refurbishment of the existing
tant role as a cargo hub for the Central and Eastern
Terminals 2A and 2B is running full swing and sub-
European market and beyond. In this respect, 2011
stantial funds have been earmarked for the im-
was the most successful year ever, with a year-on-
provement of the infrastructure. Up to the end of
year rise in cargo freight of 30% to nearly 107,000
2011, 97 % of the committed total of EUR 261 million
tons.
had already been invested in projects:
Cargo Volume
8
2011
2010
2009
2008
106,595
82,638
62,870
73,155
9
Statement of financial position notes
Financial Highlights
Property, plant and equipment and intangible assets
Consolidated statement of financial position
The 2011 increases in property, plant and equipment and intangible assets mainly related to the construction of the SkyCourt, the new passenger hall between Terminals 2A and 2B which was capitalized on 27 March 2011. In addition the
(in EUR)
31 December 2011
31 December2010
42,656
33,157
2,169,931
2,157,128
67,023
30,983
2,279,610
2,221,268
4,259
5,041
15,411
27,092
Cash and cash equivalents
101,863
87,320
Other receivables
25,972
41,670
147,505
161,123
2,427,115
2,382,391
133,357
(34,370)
refurbishment of Terminals 2A and 2B started at the end of 2011.
ASSETS
Non-current assets
Equity
Property, plant and equipment
Intangible assets
Other non-current assets
Total non-current assets
Current assets
In 2011 the company settled its current borrowings partly from equity injection. In addition the Hungarian state,
non-controlling shareholder of Budapest Airport Zrt., sold its interest in Budapest Airport Zrt. The purchase of the
non-controlling shareholding was also financed by capital increase.
Borrowings
Inventories
Trade receivables
Total current assets
Total assets
The main change in borrowings was the settlement of the current borrowings which was financed by capital increase
and shareholder loan increase. As of 31 December 2011 the total amount of borrowings (both short and long
term) consisted of EUR 595,757 shareholder loans and EUR 1,274,320 bank borrowings.
Consolidated income statement
(in EUR)
for the period ended 31 December 2011
for the period ended 31 December 2010
LIABILITIES
Revenue
291,540
255,173
Non-current liabilities
Raw materials and consumables
(118,025)
(92,405)
(8,407)
(8,479)
(30,942)
(29,761)
(21,441)
(17,252)
(29,429)
(13,721)
EQUITY
Borrowings
used
1,840,381
1,557,047
310,061
223,711
Utility expenses
Other non-current liabilities
68,013
42,998
Employee benefit expense
Total non-current liabilities
2,218,455
1,823,756
Derivative financial instruments
Depreciation and amortization
Other income, costs and expenses
Current liabilities
Trade payables
Borrowings
Other current assets
Total current liabilities
Total liabilities
Total equity and liabilities
19,453
40,472
Operating profit
83,296
93,555
29,696
531,368
Finance income
1,569
619
26,154
21,165
(111,793)
(113,023)
75,303
593,005
Loss before income tax
(26,928)
(18,849)
2,293,758
2,416,761
Income tax expense/benefit
(23,503)
4,060
2,427,115
2,382,391
Loss for the period
(50,431)
(14,789)
2011
2010
114,940
103,723
120,119
94,337
50,487
51,624
5,994
5,489
291,540
255,173
Finance costs
General Information
Income statement notes
The consolidated financial statements audited by PriceWaterhouseCoopers and the key figures comprise
the ultimate parent company Airport Holding Tanácsadó Kft, its subsidiaries Airport Hungary Tanácsadó Kft,
Revenues (in EUR)
Budapest Airport Zrt, Airport Facility Management Kft and RÜK Kft.
Aviation revenues
Fuel supply revenues
Rental revenues
Other
Total
The increase in aviation revenues was due to the higher passenger numbers and the augmented aviation fees
compared to last year. Fuel supply revenues rose due to the higher kerosene price.
10
11
Raw materials and consumables used (in EUR)
Cost of Fuel Sale
Other
Total
2011
2010
(113,630)
88,177
(4,395)
(4,228)
(118,025)
(92,405)
The increase in cost of fuel sale is due to the higher kerosene price.
Other income, costs and expenses
The main reason for the increase in other income, costs and expenses is that it contains a net bad debt provision for
Budapest Airport’s biggest customer Malév Hungarian Airlines which ceased operations on 3 February 2012.
2011
Flight offer: 94 destinations
Income tax expense/benefit (in EUR)
through 34 airlines
2011
2010
Current tax
(3,707)
(3,304)
Deferred tax
(19,796)
7,364
(23,503)
4,060
Total
The main reason for the increase in income tax expense is due to a tax law change. The deferred tax rate
changed from 10 % to 19 %.
Segment split 2011
4%
26%
36%
Outlook for 2012
34%
Malév grounding
Road to recovery
On 3 February 2012, Budapest Airport’s biggest custom-
Budapest Airport is doing its best to attract new air-
Low-cost 26 %
er, Malév Hungarian Airlines, ceased operations and has
lines, launch new destinations and increase fre-
Full-service 34 %
gone into liquidation.
quencies on existing high-demand routes.
Airlines
4%
Malév 36 %
in both the traditional and the low-cost segment
Charter 4 %
Key figures
Key figures
2011
2010
171,421
160,836
98,248
104,647
45.3
86.1
Debt (EURm)
1,274.3
1,766.1
Cash (EURm)
101.9
87.3
1,172.4
1,678.8
Sales w/o fuel (EUR)
EBITDA w/o fuel margin (EUR)
Capex (EURm)
Net debt (EURm)
This impacts not only on passenger revenues but also
5
26%
have responded positively.36%
on income generated, for instance, by leased property
and maintenance. The liquidation process is ongoing
Just five weeks after Malév was grounded, 80 % of
2012 (reforecast)
after the preparation of our consolidated financial
the point-to-point traffic it had been scheduled to
Flight offer: 92 destinations
statements; however, these reflect this impact.
carry had been taken up by other airlines. Further-
through 36 airlines
34%
more, the launching of new destinations will step up
Budapest Airport expects to be able to recover a sub-
the point-to-point passenger volume to 95 % of its
stantial proportion of the lost revenues by means of
previous level. At the same time, though, no major
additional business with existing and new partners.
recovery in transfer traffic can be expected. Overall,
Moreover, the management is taking all the necessary
the development of passenger numbers can be
steps to re-establish Budapest Airport’s profit-generating
viewed as very favorable, but the contribution made
ability to the level reached before the Malév grounding.
to this by the use of larger aircraft and by higher load
3%5%
52 %
40%
factors must be borne in mind. Accordingly, the reThe grounding of Malév has forced Budapest Airport to
covery in the number of aircraft movements is likely
adjust its operations and the company structure and to
to be much slower.
Revised forecast
Low-cost 52 %
suspend planned investments. It has had to dismiss 250
Full-service 40 %
employees, representing 20 % of the workforce. As a fur-
Malév 3 %
ther cost-cutting measure, traffic has been relocated from
Charter 5 %
Terminal 1 to the much more spacious Terminal 2.
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13
Budapest Airport at a glance
Budapest Airport is Hungary’s largest international airport.
Operations
Terms of concession
100 percent privatization, duration until 2080, contract concluded
6 June 2007
Ownership structure
49.666 % HOCHTIEF AirPort, 18.167 % Caisse de depôt et placement du
Québec, 18.167 % Malton Investment Pte Ltd, 10 % Aero Investment S.á.r.l.,
4 % KfW IPEX-Bank
Technical Data
Total area of airport
1,515 hectares
Location
Budapest Ferihegy, 16 kilometers south-east of Budapest’s city center
Geographical coordinates
47° 26’ 22” N, 19° 15’ 43” O
Airport codes
BUD (IATA), LHBP (ICAO)
Terminal 1
T1 (opened May 1950, reconstructed 2005, total 2.5 million passengers)
Terminal 2
2A (opened 1985, 2.2 million passengers)
2B (opened 1998, total 4 million passengers)
SkyCourt (opened 2011 between 2A and 2B, the new large Terminal 2,
total 10.5 million passengers approx)
Runways
Runway 1 (13R-31L) 3,010 m Runway 2 (13L-31R) 3,707 m
Passengers (in million)
8.9
8.2
2011
2010
Revenues (in EURk incl. fueling)
291.5
255.2
2011
2010
Budapest Airport: an economic powerhouse
The approximately 9,000 employees working at Budapest Airport contributed HUF 73 billion
to Hungarian GDP in 2009. Total spending generated by the airport (direct, indirect and
passenger spending) exceeded HUF 236 billion. Its economic impact supported 32,000 jobs
in total. (Source: Research project by University of Szeged)
Publisher: Budapest Airport Zrt., Communication, Tel.: + 36 1 296-6753, E-mail: [email protected]
14
Status: June 2012